The Contractor's Compass February 2016

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ASA’s

THE OFFICIAL EDUCATIONAL JOURNAL OF THE AMERICAN SUBCONTRACTORS ASSOCIATION

WWW.ASAONLINE.COM

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Putting Your Best Sales Foot Forward

FEBRUARY 2016

Marketing & Selling Your Services

Supporting BD: The Behindthe-Scenes Marketing/ Admin Function Business Development Skillset Project Pursuit: BD Leverage The Ideal Client: Early Detection Strategic Marketing That Works—Would You Buy Your Own Services?

Hall-of-Fame Shipping Managers Reveal Their ‘Aha’ Moments Legally Speaking: What’s in a Name? Protecting Your Brand

Register Online!

March 3-5, 2016 Miami, FL • See page 16

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ASA’s

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February 2016

Features Putting Your Best Sales Foot Forward........................................... 10

EDITORIAL PURPOSE The Contractor’s Compass is the monthly educational journal of the Foundation of the American Subcontractors Association, Inc. (FASA) and part of FASA’s Contractors’ Knowledge Network. The journal is designed to equip construction subcontractors with the ideas, tools and tactics they need to thrive.

by Tom Woodcock

Supporting BD: The Behind-the-Scenes........................................ 12 Marketing/Admin Function

The views expressed by contributors to The Contractor’s Compass do not necessarily represent the opinions of FASA or the American Subcontractors Association, Inc. (ASA).

by Larry Silver

Business Development Skillset....................................................... 13

EDITORIAL STAFF Editor-in-Chief, Marc Ramsey

by Larry Silver

Project Pursuit: BD Leverage.......................................................... 14

MISSION FASA was established in 1987 as a 501(c)(3) taxexempt entity to support research, education and public awareness. Through its Contractors’ Knowledge Network, FASA is committed to forging and exploring the critical issues shaping subcontractors and specialty trade contractors in the construction industry. FASA provides subcontractors and specialty trade contractors with the tools, techniques, practices, attitude and confidence they need to thrive and excel in the construction industry.

by Larry Silver

The Ideal Client: Early Detection.................................................. 15

by Larry Silver

Strategic Marketing That Works—................................................ 18 Would You Buy Your Own Services?

FASA BOARD OF DIRECTORS Richard Wanner, President Letitia Haley Barker, Secretary-Treasurer Brian Johnson Robert Abney Anne Bigane Wilson, PE, CPC SUBSCRIPTIONS The Contractor’s Compass is a free monthly publication for ASA members and nonmembers. Subscribe online at www.contractorsknowledgedepot.com.

ADVERTISING Interested in advertising? Contact Tony Kozak at (716) 844-8174 or advertising@asa-hq.com.

by Gregg Schoppman

Hall-of-Fame Shipping Managers ................................................ 21 Reveal Their ‘Aha’ Moments

by UPS

Departments CONTRACTOR COMMUNITY............................................................ 4

EDITORIAL SUBMISSIONS Contributing authors are encouraged to submit a brief abstract of their article idea before providing a fulllength feature article. Feature articles should be no longer than 1,500 words and comply with The Associated Press style guidelines. Article submissions become the property of ASA and FASA. The editor reserves the right to edit all accepted editorial submissions for length, style, clarity, spelling and punctuation. Send abstracts and submissions for The Contractor’s Compass to communications@asa-hq.com.

ABOUT ASA ASA is a nonprofit trade association of union and non-union subcontractors and suppliers. Through a nationwide network of local and state ASA associations, members receive information and education on relevant business issues and work together to protect their rights as an integral part of the construction team. For more information about becoming an ASA member, contact ASA at 1004 Duke St., Alexandria, VA 22314-3588, (703) 684-3450, membership@asa-hq.com, or visit the ASA Web site, www.asaonline.com.

CONSTRUCTION IN THE COURTS.................................................... 8 LEGALLY SPEAKING.......................................................................... 22 What’s in a Name? Protecting Your Brand

by Michelle Campney

Quick Reference

LAYOUT Angela M Roe angelamroe@gmail.com

ASA/FASA CALENDAR..................................................................... 24 COMING UP....................................................................................... 24

© 2016 Foundation of the American Subcontractors Association, Inc.

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Contractor Community ASA Publishes Subcontract Documents Suite to Help Members with Negotiations Construction subcontractors routinely are asked to sign subcontracts that vary widely on complicated issues like payment, indemnity, extra work and claims and force them to shoulder the risks best borne by others. To help ASA members improve their subcontract bidding and negotiations, ASA’s Task Force on Contract Documents has updated ASA’s valuable contract documents and packaged them together in a new ASA Subcontract Documents Suite 2016. This suite includes: • ASA Subcontractor Bid Proposal • ASA Wrap-up Insurance Bid Conditions • ASA Subcontract Addendum • ASA Wrap-up Insurance Subcontract Conditions • ASA Short-Form Subcontract Addendum “ASA believes that all members of the construction team must be willing to step forward to accept their traditional responsibilities and the risks that are part of this responsibility,” said Task Force Chair Brian Cubbage, contracts administration counsel for Heico Construction Group, Alexandria, Va. “Subcontractors must accept responsibility for quality performance, prime contractors must accept responsibility for coordination, and architects must accept responsibility for design.

Unfortunately, all too often this is not the case. So ASA has provided its members with the ammunition to fight back: The ASA Subcontract Documents Suite.”

The ASA Subcontractor Bid Proposal (2016) offers subcontractors and their clients an opportunity to establish the standard terms of

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the ASA-endorsed ConsensusDocs 750 Standard Form of Agreement Between Constructor and Subcontractor. If a client accepts the subcontractor’s bid that has been properly conditioned with this form, a binding contract exists based on the terms of the ConsensusDocs 750.

If not already obligated to sign a particular subcontract, a subcontractor can use the updated ASA Subcontract Addendum (2016) to ask a client to modify its proposed subcontract to eliminate a wide range of potentially harmful provisions.

In more limited negotiations, a subcontractor can use the updated ASA Short-Form Subcontract Addendum (2016), which would modify the client’s subcontract in four key areas: hold harmless, insurance, payment, and changes and claims.

Both the bid proposal and subcontract addenda state that the subcontractor will not participate in a wrap-up insurance program.

For projects that require wrap-up insurance, the ASA Subcontract Documents Suite includes Wrap-up Insurance Bid Conditions and Wrapup Insurance Subcontract Conditions.

These tools give subcontractors the right to supplement the insurance provided by the wrap-up; limit their own insurance to not apply to the work covered by the wrap-up; limit their contractual indemnity to the coverage and limits provided by the wrap-up; indemnify against paying wrap-up deductibles; and procure replacement insurance or terminate the subcontract agreement at the client’s cost if the wrap-up insurance is discontinued. The ASA Subcontract Documents Suite 2016 is a no-cost member benefit available under the Contracts and Project Management section of the members-only area of the ASA Web site.

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FASA Helps Subcontractors Identify Lien and Bond Rights in Each State Construction subcontractors and suppliers rely on mechanic’s lien and payment bonds to assure that they are paid for work they perform and materials they furnish on construction projects. To help subcontractors understand their lien and bond rights in the states in which their company does business, the Foundation of ASA has updated its Lien & Bond Claims in the 50 States, a downloadable manual which outlines the lien and bond laws in each state and the District Columbia.

A mechanic’s lien is a claim against property to secure a debt, such as a debt owned to a construction subcontractor for the value of work performed and materials furnished on a construction project. A payment bond, which is required on most public construction, assures the owner that the prime contractor will pay its subcontractors and suppliers.

The FASA manual provides a summary of the basic requirements of each state’s lien and bond laws, including who is covered; critical deadlines for notices, claims and suits; filing procedures; and more.

The summary of laws was prepared

by Donald W. Gregory, Esq., and Eric B. Travers, Esq., Kegler, Brown, Hill & Ritter, Columbus, Ohio, ASA’s general counsel, with input from attorneys from around the country. Lien & Bond Claims in the 50 States (Item #3006) is $55 for ASA members and $80 for nonmembers.

Foundation of ASA Publication Summarizes State Retainage Laws Before you bid or negotiate your next contract, be sure to know the laws regarding retainage where the project is located. The Foundation of

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ASA’s updated Retainage Laws in the 50 States 2016—a no-cost member benefit available under the Contracts and Project Management section of the members-only area of the ASA Web site—summarizes retainage laws in the states and the District of Columbia. Each state entry reviews critical factors in retainage laws for public and private work, including the rate permitted, release milestones and any options to provide alternative securities in lieu of retainage.

In most states, retainage is a typical practice in both public and private construction contracts. The mandatory or permissive nature of retainage varies from state to state. In a few states, the retained funds may be held in escrow, to be paid back to the contractor or subcontractor with interest. Some states also permit contractors and subcontractors to substitute securities in lieu of retainage. Other states require contracting agencies or owners to reduce or even eliminate the rate of retainage once a certain portion of the contract is complete.

The ASA-member law firm and ASA general counsel, Kegler, Brown, Hill and Ritter in Columbus, Ohio, prepared the manual, which contains contributions from construction attorneys from across the country.

“Since its founding in 1966, ASA has been an advocate for the elimination or reduction of retainage,” said ASA Chief Advocacy Officer E. Colette Nelson. “Through ASA’s efforts, the federal government eliminated routine retainage on

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Early-Bird Deadline to Register for SUBExcel 2016 Ends Feb. 8—Register Now!

federal construction in 1983. ASA chapters and members continue to lead efforts to reduce retainage on public and private construction in their states.”

Nelson added that ASA members who are interested in pursuing retainage reform can consult ASA’s A Guide to Passing Retainage Reform in Your State.

Subcontractors can learn more about negotiating retainage, including effective strategies for convincing general contractors to reduce or eliminate retainage, in the Feb. 9, 2016, ASA webinar, “Negotiating Retainage.” Presenter Eric Travers, Esq., Kegler, Brown, Hill & Ritter, Columbus, Ohio, ASA’s general counsel, will explain how subcontractors can broach the topic of reducing or eliminating retainage with their clients and how to negotiate from a position of strength. He will also illustrate how subcontractors can modify their bids to reduce or wholly eliminate retainage, including discouraging withholding for closeout line items.

This live, 90-minute webinar will begin at 12:00 p.m. Eastern time / 9:00 a.m. Pacific time. The registration fee is $99 for members and $179 for nonmembers. Register online.

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The early-bird deadline to register for SUBExcel 2016 is Feb. 8, 2016. Register online or complete and return the printable registration form today! While the cutoff date to reserve a guaranteed room in the ASA room block at the Hyatt Regency Miami during SUBExcel 2016 has passed, you can still make your hotel reservations online while rooms remain available. If you find you cannot get accommodations at the Hyatt because they are sold out for your nights of stay, ASA has negotiated an overflow hotel across the street.

You can reserve your room with the Courtyard Marriott, Downtown Miami for the special ASA group rate of $229 per night. Reservations must be made

by Feb. 19, 2016.

SUBExcel 2016 will take place March 3-5, 2016, in downtown Miami. ASA will celebrate its 50th anniversary during SUBExcel 2016. ASA encourages you to register and bring additional members from your company, as well as your spouse, to share in this momentous occasion. ASA’s special 50th anniversary celebration will include a reception, banquet and awards gala on board the luxury yacht, The Biscayne Lady. Formal attire is encouraged.

Visit SUBExcel 2016 for more information or enter through the www.

SUBExcel.com portal.

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California Court Applies ‘Strict Liability’ to Construction Subcontractors A California court has ruled that a subcontractor can be held “strictly liable” for installing material on a project that complied with specifications which the subcontractor did not write, and which was approved by the architect.

ASA, joined by the Association of the Wall and Ceiling Industry and the Roofing Contractors Association of California, had submitted a “friend of the court” brief that argued that “[S]trict liability on subcontractors would place liability on a party who does not control the risk. It would also broaden liability in construction thereby raising insurance rates to contractors throughout California, which in turn would unnecessarily raise construction costs in a still struggling economic environment.”

Nonetheless, on Dec. 22, 2015, a California Court of Appeal in Jovana Hernandezcueva v. E.F. Brady Company, Inc. ruled that the “evidence sufficed to show that E.F. Brady was involved in the stream of commerce relating to the defective products. E.F. Brady was capable of bearing the costs of compensating for injuries due to the products, made sizeable purchases of the defective products, and always arranged to pass its material costs through to the ultimate user. Moreover, due to E.F. Brady’s relationship with Kaiser [the drywall manufacturer] and Hamilton [the joint compound manufacturer], it was ‘in a position to exert pressure on the manufacturer’ to improve product safety.”

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The underlying dispute involved litigation by an individual dying of cancer allegedly caused by asbestos in products that E.F. Brady installed in a commercial building project as a drywall subcontractor in the 1970s.

OSHA Again Delays Confined Space Enforcement for Residential Contractors The Occupational Safety and Health Administration has delayed the enforcement of the Confined Spaces in Construction Standard for residential construction work to March 8, 2016. The new rule went into effect on Aug. 3, 2015.

Under the delay policy, OSHA will not issue citations under the confined space standard to an employer engaged in residential construction work if that employer is making good faith efforts to comply with the standard, as long as the employer is in compliance with either the training requirements of the new standard or the former training requirements.

Factors that OSHA will consider when evaluating whether an employer is engaged in good faith efforts to comply with the new standard include: • If the employer has not trained its employees as required under the new standard, whether the employer has scheduled such training; • If the employer does not have the equipment required for compliance with the new standard, including personal protective equipment, whether the employer has ordered or otherwise arranged to obtain such equipment required

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for compliance and is taking alternative measures to protect employees from confined space hazards; and • Whether the employer has engaged in any additional efforts to educate workers about confined space hazards and protect workers from those hazards.

To help employers comply with the rule, OSHA has published a guide, Protecting Employees in Confined Spaces: Small Entity Compliance Guide, and other information on a Confined Spaces in Construction Web page.

OSHA Fines to Increase by More Than 80 Percent Fines for safe and healthy workplace violations will increase by as much as 80 percent on Aug. 1, 2016, under a new law signed

by President Obama on Nov. 2. The provision, which was approved by Congress as part of the Bipartisan Budget Act, increases fines issued by the Occupational Safety and Health Administration for the first time since 1990. The new law is intended to bring OSHA fines, as well as fines by the worker safety agencies in State Plan States, in line with inflation over the last 25 years. The fine for each serious violation could increase from $7,000 to $12,743 and the fine for each repeat and willful violation could increase from $70,000 to $127,438.

The new law also indexes OSHA fines to future increases in inflation.

OSHA was expected to publish a rule for public comment shortly after the new year. ASA will participate in the rulemaking process.

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DOL Publishes Wage Garnishment Procedures On Oct. 8, 2015, the U.S. Department of Labor published an interim final rule, effective upon publication, that establishes new administrative wage garnishment procedures. The rule allows DOL to garnish the disposable wages of nonfederal workers who are indebted to the agency without first obtaining a court order.

The rule lists the notice requirements, which includes an explanation of the debtor’s rights.

The debtor is allowed to inspect agency records related to the debt, enter into a written repayment agreement, and have a hearing. The rule also establishes procedures related to the debtor’s employer. In addition to a withholding order, the agency must send to the employer a certification, which the employer is required to complete and return to the agency. The certification addresses information about the debtor’s employment status and disposable pay available for withholding. After the employer receives a garnishment order, the employer must deduct from all disposable pay paid to the applicable debtor during each pay period the amount of garnishment described in the order. An employer may not discharge, refuse to employ or take disciplinary action against a debtor due to the issuance of a withholding order.

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VA Proposes to Amend Rules Governing Veteran Preference Program The Department of Veterans Affairs has proposed to amend its regulations governing the VA VeteranOwned Small Business Verification Program. The VA reports that it attempting to find an appropriate balance between preventing fraud in the Veterans First Contracting Program and providing a process that would make it easier for more VOSBs to become verified.

The Verification Program has been the subject of reports from both the Government Accountability Office and the VA’s Office of Inspector General stating that despite the VA’s Verification Program, fraud still exists in the Veterans First Contracting Program. According to the VA, stakeholders have suggested that the current regulations are too open to interpretation and are unnecessarily more rigorous than similar certification programs run by the Small Business Administration.

The proposed rule, published on Nov. 6, 2015, would clarify the eligibility requirements for businesses to obtain “verified” status, add and revise definitions, reorder requirements, redefine the definition of “control,” and explain examination procedures and review processes.

The proposed rule also would implement new changes, including removing, revising or limiting in scope references to community property restrictions, “unconditional” ownership, day-to-day requirements,

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and full-time requirements. In addition, the proposed rule would add an exception for majority, supermajority, unanimous, or other voting provisions for extraordinary business decisions.

DOL Reports that Fatal Work Injuries in Construction Increased 6 Percent in 2014 Preliminary results from the Bureau of Labor Statistics’ Census of Fatal Occupational Injuries show the rate of fatal work injuries in 2014 was 3.3 per 100,000 full-time workers, the same as the final rate for 2013.

However, during that same period, construction fatalities rose to 874 in 2014 from 828 in 2013. The number of fatalities in construction was the highest reported total since 2008. Also of note to construction employers, the number of fatal occupational injuries incurred by contracted workers was 797 or 17 percent of all fatal injuries.

DOL reported that fatally-injured contracted workers were most often contracted by a firm in the privateconstruction industry sector (164 or 21 percent of all contracted workers).

Decedents in this group were most often employed as construction laborers (108), electricians (48), firstline supervisors of construction trades (44), and roofers (42).

Upon the release of the data, U.S. Secretary of Labor Thomas E. Perez said, “Far too many people are still killed on the job—13 workers every day taken from their families tragically and unnecessarily. These numbers underscore the urgent need for employers to provide a safe workplace for their employees as the law requires.”

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Construction in the Courts Edited by R. Russell O’Rourke, Esq., partner and chair of the Construction Law Group, Meyers, Roman, Friedberg & Lewis, Cleveland, Ohio.

A brief review of recent cases that affect your business Ohio. The Ohio Court of Claims (trial court) has ruled against a contractor for failing to properly initiate a claim pursuant to the terms of the contract. In IPS Elec.

Servs., L.L.C. v. Univ. of Toledo, the electrical contractor for the construction of an addition to a medical facility owned by the University of Toledo (“UT”) brought an action for breach of contract against UT following completion of the project alleging damages resulting from an accelerated completion date and delays by other participants in the project.

Despite acknowledging that the electrical contractor had proved that some of UT’s actions constituted breach of contract, the Court entered judgment in favor of the UT because the electrical contractor failed to submit a certified claim letter to the appropriate parties within 10 days of the date that the claim accrued and failed to substantiate the claim within an additional 30 days, both actions being required under the contract.

The contractor argued that had waived strict compliance with the contract; however, the Court following prior Ohio Supreme Court cases, including Foster Wheeler Enviresponse, Inc. v.

Franklin County Convention Facilities Authority and Dugan & Meyers Construction Co., v. Ohio Department of Administrative

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Services ruled against the contractor, holding that “ORC 153.12(B) presents a rare instance where a statute requires a plaintiff to exhaust its administrative remedies before bringing suit.

Unlike the judicially-created exhaustion of administrative remedies doctrine, the statute does not include any exceptions.”

By not complying with the claim provisions set forth in the contract, the electrical contractor failed to exhaust its administrative remedies and waived its claims.

Alan Dailide is an associate in the Construction and Litigation practices of the Cleveland law firm Meyers, Roman, Friedberg & Lewis.

Dailide can be reached at (216) 8310042 or via email.

Texas. Every contractor has an obligation to retain material project records and to require the preservation of work known or suspected to be the subject of a legal dispute. If not, a contractor may suffer the consequences of spoliation or waive its rights to pursue spoliation remedies.

Spoliation is “the intentional destruction, mutilation, alteration or concealment of evidence … which if proved … may be used to establish that the evidence was unfavorable to the party responsible.” Black’s Law Dictionary 1409 (7th ed. 1999).

The intent to spoil evidence can be proven by, among other things,

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reckless disregard of an established data storage protocol or by showing there was no plausible reason to modify work claimed to be defective before the contractor has a chance to conduct an independent evaluation.

The Appellate Court in Miner Dederick Constr., LLP v. Gulf Chem. & Metalurgical Corp. held that, “although it need not take extraordinary measures to preserve evidence, a party has a duty to exercise reasonable care in preserving potentially relevant evidence.” The Court found that the contractor was unduly prejudiced by spoliation when the owner altered allegedly defective work before contractor could conduct its own tests. The Appellate decision partially affirmed and partially reversed the Trial Court’s ruling.

Then, the Texas Supreme Court denied Gulf Chemical’s petition for review, in essence affirming the lower Court’s decision directing the Trial Court to the Supreme Court’s recent decision in Brookshire Brothers, Ltd. v. Aldridge to reconsider all spoliation issues.

Some jurisdictions actually allow damages claims for losses caused by spoliation of material evidence. Other jurisdictions leave it to the judge’s discretion to punish spoliation with monetary sanctions, harsh evidentiary rulings, adverse jury instructions and even dismissal

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of the case if the contractor has been deprived of its opportunity to defend.

Construction projects today come with a high volume of electronically stored data typically kept on company devices and computers.

Many workers, however, often rely on their personal devices to send and receive information about the project. Contractors should have a data retention protocol that is accountable for this and every other scenario whereby material project records need to be identified and retained. In addition, a contractor’s protocol should include procedures for notifying owners to preserve work claimed to be defective.

Having a clear policy on data retention and notice may not only save a contactor from spoliation claims and sanctions but may also protect a contractor’s right to seek its remedies.

Rick Erickson is a partner in the Construction, Commercial Litigation and Military Law practice groups of the Phoenix office of the law firm Snell & Wilmer, LLP. Erickson can be reached at (602) 382-6540 or via email.

Washington. A big dollar dispute between a joint venture tunneling contractor and a public entity sheds some much needed light on differing site conditions and the difficulties in recovering damages against a public entity, even if you are one of the world’s

largest contractors. The dispute stemmed from problems that arose and significant delays that occurred during a major expansion of the King County’s wastewater treatment system, known as the Brightwater project.

Vinci Construction and its partners (Vinci JV) worked on the tunnel boring project for King County sewage infrastructure project from 2006 through 2010.

Vinci JV encountered substantial problems in their boring operation due to unforeseen subsurface soil conditions which caused considerable delays and cost overruns. When Vinci JV failed to meet its contractual deadlines the County retained another company to finish the project and filed a lawsuit for damages, resulting in a verdict for over $155 million, one of the largest jury verdicts in Washington history.

Vinci JV’s claim was based on the discrepancy between subsurface soil conditions described in the contract and those actually encountered which caused significant work delays.

After setting out the four-part test, the Court in King County v. Vinci Construction Grands Projects/ Parsons RCI/Frontier-Kemper, JV ruled against Vinci JV because although the contract provided general information regarding soil conditions, such as differing soil types and related hyperbaric

pressures, the contractor assumed the risk that such information might differ from the actual conditions.

The Court also upheld the Trial Court’s ruling against Vinci JV for defective specification in connection with contractual terms since the Court found that the claim was actually one of differing site conditions because although the machine may have been inadequate for the conditions present, there was no evidence of defect with the specific boring machine used by Vinci JV. To add insult to injury, the Court also awarded attorney fees against Vinci JV and its sureties.

For contractors involved in claims involving differing site conditions, it is clear that the requirements of an affirmative representation as to site conditions and actual reliance on those conditions are necessary requisite to support these claims and contractors should be push for disclosure of such affirmative representations during the bidding process and make sure such representations are present when pressing claims that arise from differing site conditions.

James Yand is a litigation partner in the Seattle law firm of Miller, Nash, Graham & Dunn. Yand can be reached at (206) 777-7404 or via email.

Feature Putting Your Best Sales Foot Forward

by Tom Woodcock I’m writing this piece while flying over our great country on my way to do a construction industry seminar in Houston, Texas. The client is a large, reputable equipment supplier that serves the construction industry. I’m always looking for the best ways to put my best sales foot forward—a practice that many contractors may not have incorporated in their sales repertoire. I see it as simply playing the angles. I know, simple right?

Some people play their sales angles organically. I don’t want to leave that much to chance. I measure and orchestrate how I’m going to play the various angles and connections to maximize my business opportunity.

As I review a selling opportunity or a secured one, I look for the other lead opportunities that may be adjacent to the one I’m currently working on. Who do they know? What future customers might they have relationship with?

What will it take in this project for me to be able to secure additional work from them? What am I going to do to stand out in this current gig that will line me up for the next? What do I want to learn about my primary contact to gain his or her favoritism going forward? These are very specific actions I will take on this lovely jaunt to the construction rich market of Houston.

Though my typical customer may differ from yours somewhat, the concept is the same. Expanding your business base from within your current customer pool can be a very effective way to grow your opportunity. It’s not simply getting

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referrals, but getting assistance and insight from those clients you’re presently with. Critics will call this manipulation. Those are usually the people that are one and out. They move from single project to single project fighting to the death to get each one. I like to find people’s hot buttons—what they like, who they love, their tastes and preferences.

I track this and log it into my CRM program. I never want my competitors to know more about my clients than I do. I strive to be in such a strong position with my current clients that they are referring people to me without my even requesting it. Of course some think of me as simply a “player” in a business sense and some clients don’t want to release the level of information required to discover the angles you need to take. That’s fine. Nothing is ever 100 percent effective. But in reality, I genuinely am interested in the clients I work with—as people, not just revenue streams. They know this and freely let me in on what it takes to make them happy and secure their business. The relationships become long-term and any competitor approaching them is looked at with a raised eyebrow.

Angles are simply the lines of influence we all are steered by— faith, family and friends come to mind initially. You do something nice that affects someone’s family and they will look at you beyond the numbers. I’ve gone to kids games, graduations, weddings, funerals and major events that my clients may

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have—sometimes even after their contract is up with me. I go because they’ve actually become friends and I believe they will always speak well of me if they run into someone who could use my services. When I have an opportunity, ticket, foursome or event that I think they’d be interested in, I call them. I’m usually accurate with my invite because I know their tastes. This sounds like a lot of work but it really isn’t. To be honest, it’s one of the perks of working with people. I’ll even look for angles with individuals that really don’t care for me. It’s almost a challenge to win them over. I remember a respected individual I called on when I first started my business. His statement to me was, “Tom, I’m happy for you but I’ll never use you.” That was fine at the time because I really wanted him as a business contact as much as a client. Two years later he became a client. He has been a client now for almost five years! I get his business philosophy and serve him with vigor. He speaks well of me to other potential clients and is a great resource—well worth investing to find his likes and dislikes.

This type of sales work takes a true commitment to selling. Casual sales efforts will not breed this depth of customer relationship and direction.

It will come off as insincere if it’s not consistent. If the only time you show your true interest in a customer is when you want their business or have their business, you’ll end up being easily readable. When you incorporate those people you’re

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currently doing business with into the fabric of your own life then they will bring you into theirs. Striving to find these angles can all of a sudden make the pressure of pricing on bids a lot less intense.

After discovering the best angles to get your sales footing, it all comes down to timing—hitting a 95-mile-anhour fastball, shooting a one-timer on goal, driving a golf ball long and straight. All these athletic acts require impeccable timing. Be off just a bit and you swing and miss, shoot wide or slice to the right. Feast or famine in many cases. I have particular trouble with the golf reference! In sales and marketing, timing is critical as well.

Sometimes the construction industry misses this key element of getting both business and opportunity.

Delaying in selling can result in lost projects or customer contact. In dealing with the sales dynamic of construction firms, I find often that sales or marketing efforts are put on the back burner. They can even be avoided because of the lack of faith they are effective. This is a very sure fire way to guarantee the stagnancy of business, or worse, demise.

Missing the timing in regards to a significant marketing opportunity has no immediate negative impact, but it produces zero positive movement.

Once the window is gone, it’s gone for a while. Follow up, event presence and brand awareness opportunities do come and go. But the premium chances need to be seized. I’ve always found it amazing how sales personnel struggle to put themselves

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in high contact scenarios, then they don’t follow up on the information they acquire. Why go? Networking events and social gatherings are useless if the data collected isn’t used. Why belong to an association if you randomly attend? What good is electronic marketing if it’s only done sporadically? Where’s the market saturation? Notice I said “saturation” not “over saturation.”

Companies spend thousands to produce marketing materials and hire business development personnel.

To apply these tools but miss the window of greatest effectiveness will not produce the desired ROI. It truly is more important to be consistently in front of the client base, than be overly picky about terms or colors. If you’re doing an electronic newsletter, get it out monthly on a set deadline. Having incongruent delivery intervals will hurt you more than help. It spaces the message out too far and smacks of disorganization. You’re defeating your purpose.

Selling is difficult enough. Why make it harder for no reason? Waiting too long to return phone calls, emails or pricing data reduces your position with the client. Skipping major sales events such as awards banquets and large, industry-related meetings eliminates the potential at those events as far as you’re concerned.

Hopefully your competitor was just as short-sighted. I don’t care how many times you’ve gone in the past. Getting there early and staying late is crucial.

The best opportunities appear when

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you leave!

If you truly value the marketing and sales aspect of your business, you’ll be diligent about the timing of it. Missing cracked doors due to hesitancy is laziness. The iron is hot, so you have to strike! Please don’t give me the “I just want it to be right” line either. Not buying it. Roll up your sleeves and get it done. Set a deadline for all marketing efforts and sales follow up. Keep those that are producing the efforts accountable.

Measure results ,then drop or add the methods that are bearing fruit.

Be aggressive in hitting the timing perfect. Nobody will do it for you.

The more critical you make the timing aspect of your sales and marketing efforts, the better the results. I’d rather have a decent plan timed well than a “blow me away” campaign that rolls out late or just misses the window. What good is a Super Bowl commercial shown on the Monday after? Even if it is the best ad. It’s really that simple. Plan ahead and move in stages. Make sure those that make commitments, keep them. A plan never enacted was just a thought. All combined with your selling angles and you’ve found how to put your best sales foot forward!

Tom Woodcock, president, Seal The Deal, St. Louis, Mo., is a speaker, trainer, and author of the book You’re Not Sellin’, They’re Buyin’! He can be reached at (314) 775-9217 or www. tomwoodcocksealthedeal.com.

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Feature Supporting BD: The Behind-the-Scenes Marketing/Admin Function

by Larry Silver If business development is the face of a company, then marketing is the make-up that highlights and enhances that face. It is common that many AEC firms try to combine the BD and marketing functions into one person to save expense, namely payroll. I understand that limitation. But realize that these two business functions, though complimentary, are very different, requiring different skill sets.

The BD/Marketing Difference Business developers are mainly out-of-the-office involved with opportunities and relationships in many categories. Even when they are in the office, they are making calls to set up the out-of-office stuff they are doing.

Marketing staff are mainly in the office and involved with creating materials, developing information online and on the computer. Marketing takes the main messages of their firms and sends it out to the marketplace to create the desired perceptions.

These two business functions are grouped together to promote and expand the firm, but they function quite differently. It is very difficult to find one person who is good and competent at both skill sets.

The Marketing Grade—100 Possible Points Collateral/Online Presence (20 Points) Every AEC firm has some information about their firm—a brochure, a Web site, a pdf, a Financial Statement for Qualifications, etc. This information and how it is presented says a lot about your firm. Hopefully, it corresponds to the image and

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message you want to send to represent your organization’s vision, mission and culture well.

PR/Image (10 Points) There are both solicited and unsolicited approaches to get published in the various publications surrounding the construction and related industries.

How well are you “getting the word out” concerning your firm—its accomplishments, news and the like?

There is a certain style, look, feel, and environment that your firm creates through use of graphics, words, and position in the marketplace.

Proposals/Presentations (15 Points) Every proposal is a sales document which sells your price throughout the pages. You espouse certain features, benefits, and proofs of your services and a particular approach to servicing a design, a project, and a space. The proposal, if it succeeds in getting you short-listed, will serve as an outline for your presentation, which should be focused on the project-specific needs of your client and hammer home why you are the best choice for that project.

Use of Technology/Internet/ Social Media (10 Points) AEC firms tend to be slow adopters along with our industry. But many firms are catching on that to use technology and the Internet to market and administrate is efficient and makes sense with so many changes in how firms communicate. Social media, and particularly LinkedIn and Facebook, are strong communications vehicles to let your marketplace know what is happening in your world.

Advertising/Trade Shows (10 Points) Although there are many changes in the marketing realm, don’t move too far away from good old advertising and trade shows. To invest in these marketing areas makes sense as you penetrate your niche of healthcare or retail. You want to be seen as a major player and as a source of referral. If these marketing staples did not work, they would have been dropped years ago. But there is still advertising on the Super Bowl and the influence continues.

Marketing Culture/Company-Wide Effort (5 Points) Just as there needs to be a BD culture and a company-wide BD effort, so the same is true with marketing.

There is a mindset to capturing all the photos, events, intelligence, and research needed to run a successful Client-Centered Service AEC firm. It is the little things that (10 Points) make a difference in life and in A huge mistake that many AEC firms business. The more you know and can make is to plaster our best projects at apply in a given strategic situation, the the front end of our presentation, saying better the probability that you will win in essence, “look how good we are.” business.

But the truth is that your prospects do Project Marketing Info/ not care about your great jobs, they Intelligence (File) (5 Points) care about what you can do for them The good in our business is a on their projects. Therefore, it behooves successful project. We want to find us to document the service we provide our clients so that it can be reproduced out and document on the front end of each project what the potential owner consistently and used as assurance to wants, needs, desires, and achieves. our future prospects what we have to offer that is different than everyone else We formulate a clear picture on the front end, which wins us the work, who all claim good quality, fast speed and then we implement that vision and competitive price. to satisfy our clients on their project.

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This information can be captured and stored by computer to be retrieved when needed to promote your success.

Education/Training (5 Points) Your marketing staff and key executives need a handle on this changing world of marketing. It is wise to attend seminars and workshops and to make needed changes over time to stay up with the latest/greatest marketing techniques and approaches.

In-house training by experts will get management on the same page as you deliberately promote your service to grow.

Marketing Plan/Budget (10 Points) This last one is a spoiler because very few AEC firms actually plan out their marketing attack and think it through ahead of time. It is imperative to do so and to get aggressive in areas that are proven to bring good or better ROI so your firm can move forward progressively to outshine the competition in a secure way for the foreseeable future.

The combined score of the previous 10 categories of marketing administration is revealing. A score below 60 means that your firm has not been performing marketing in any consistent fashion, nor have you

invested in its powerful principles to springboard your AEC firm in your niche. After grading your firm, take the actions steps necessary to bring it up at least 10-20 points in 2016.

Larry Silver is president of Contractor Marketing Inc., a consulting/recruiting firm in the AEC Industry. Silver performs strategic planning, marketing/business development audits and training, and is currently the publisher/editor-in-chief of Business Development, an ezine that is distributed to more than 100,000 firms.

Silver can be reached at (937) 776-7170 or larry@contractormarketing.com.

BUSINESS DEVELOPMENT SKILLSET by Larry Silver A key question that is frequently asked is, “What is the profile of a successful business developer? What traits, characteristics, and behaviors does this person exhibit?

A business developer first and foremost fosters relationships. To foster relationships takes time and consistency.

He or she must bring value to the table. After a while, giving trinkets and playing golf does not cut it. Although if you are helping someone with their golf game, that has perceived value.

Secondly, the business developer is the orchestra leader on project opportunities. Gathering necessary marketing intelligence, prequalifying a viable match between the opportunity and the resources of the firm and bringing the internal players together in a timely and unified effort are all responsibilities of the business developer.

Therefore what is needed is someone who can organize, motivate and work well alongside others to get results.

This profile is one of a team player. An independent maverick does not sit well on the management team of most construction companies.

A third characteristic of the business developer is the ability to manage information/technology. To be good at sales is not enough. This position requires managing projects, prospects, and ally information. When it comes

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time to respond with solid and relevant information, the business developer has a system ready to go.

Lastly, the business developer is the customer-satisfaction specialist. They are the ones who hear about trouble, problems, and ill will. They tactfully communicate back to the troops what the deal is and inquire as to the remedy. Then they follow through to assure that the client is fully satisfied. The result is a happy client with the desire to work again and again with your firm.

The business developer’s role is indispensable. It is true that it is difficult to measure the impact of this person on your firm. Therefore it is prudent to have them report their progress in a weekly meeting and to hold them accountable to the strategic direction of the company.

If you carefully question a potential candidate about their skillset, you should be able to rate them on the aforementioned attributes. There should be proof of their previous results to confirm what you are hearing about them.

The more experience this individual has, of course, the more expensive they will be to hire. However, if you find the business developer with the appropriate skillset, they will bring a return on your investment much more quickly.

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Feature Project Pursuit: BD Leverage

by Larry Silver

There are two activities that every business developer in the AEC industry has to do—build relationships and chase opportunities.

Of course, the two are linked to each other in clear and significant ways.

For one, if you know an owner who is considering a construction project, then you are already ahead of the game. You may be the incumbent who has the leverage, the advantage, the upper hand before the gate is even opened. It is your project to lose because the owner knows and trusts you ahead of all other suppliers of your services.

But don’t take that relationship for granted. Don’t forget what it took to put you in that driver’s seat—a lot of hard work, premium service and lavishing unexpected favors. If you put it in “cruise control,” beware.

Some other hungry firm will come along and do what you did so well to win the business in the beginning.

Second, you may hear of a project and introduce yourself from scratch to the owner or project representative.

Maybe your firm has a good enough reputation and standing to jump in the fray from scratch. This is one way to do business development. Chase a project and voila, a relationship begins to form.

In many instances the owner has no way of knowing who the best choice is to award the work; it is too subjective. They can only observe what each firm does during the process and extrapolate that the behavior they see up front will represent what your firm offers during the project.

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Therefore, every move you make from the onset is reflecting the face and hands and feet of your company.

The owner has no clue who is better at digging a hole and sticking a building in it. Each firm must sell its price for the individual project they are pursuing. How does one do that? Sell your price? That is what the business development process is all about. Ultimately, a proposal must be produced and submitted to the owner revealing your progress in the project pursuit.

But first, before the proposal is submitted, a fairly in-depth process will help to flesh out the factors and issues you are contending for. For, in the conclusion, the owner must ask which firm best suits their needs on the project in question.

Project Intelligence Regardless of whether you are the incumbent or not, you should still go through the same paces to ascertain a project-specific understanding of what the owner wants, needs, aspires to, has concern with, etc. Your goal is to find out what their goal is for the project. No RFP will ever give you the needed clues to discern the subjective, intangible issues driving the work.

Ask the owner or representative the following questions as you gather your intelligence: • What is the likelihood (%) that this project will actually move forward?

• What is the project budget and how much is in place currently?

• What delivery method does the owner prefer? Why? What is the history there?

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• Are they willing to negotiate if the

design, budget and schedule are fully satisfied?

• What are the top five project issues…can you rank them in priority order? (usually the list includes schedule, price, safety, communication, aesthetics, functionality, ease of working together, relationship/comfort level, etc) • How many other firms will be involved with the project competition?

• What are the selection criteria?

Is there a committee, a matrix of points, influencers who are not seen but weigh in before the decision is made?

• What is the main business reason/ goal for this project?

After you gather your needed intelligence, it is time to discern whether you have a legitimate shot at winning, performing, and profiting by this project. Please see the Prequalification Matrix, which I designed based on 100 points and, of which, 70 is the cutoff mark to pursue the project.

Below that score, it is not worth your firm’s resources to pursue the work—the cost is too high or your probability of winning the work is too low to expend the resources. Invest them on an opportunity that better fits your bill.

— Continued on page 17

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THE IDEAL CLIENT: EARLY DETECTION by Larry Silver I want to begin this feature by sharing that I believe it is difficult to make money in the AEC industry. Most firms work on razor-thin margins and the risk far outweighs the profit potential. So, my hat off to you and your firm for being in a super tough and competitive industry where low-hanging fruit is not plentiful.

I would like to impart some relevant ideas to help you focus your company growth efforts in line with your management’s values and ideals.

AEC firms like to chase work—projects of various sorts that seem to fit our bailiwick or momentary fancy. This could be a strategic mistake. If you knew what this prospective client was really like—how they avoid paying their bills or how they routinely withhold retainage, even after the work is satisfactorily completed—would you be so eager to commence business with them? Of course not!

Intelligence Questions There are some further intelligence questions that can guide your decision-making process regarding client pursuit.

• Does this prospective client have projects that match our strengths and capabilities? Are they used to the delivery methods that our firm uses on a regular basis?

• Can we service a part or all of their needs from a geographical basis? If not, can we joint venture with a partner firm that can help us serve this client, while allowing us the relational advantage?

• Does this client’s work have the needed profit potential to continue repeat business?

• Is this client fair and reasonable when it comes to negotiating construction issues? Are they responsive in communicating decisions that allow us the So, before you go off half-cocked to pounce on any job latitude to keep up the schedule and quality adjustthat moves in your sights, consider the following methments? odology. If you can size up each prospective client early in the process, you can detect, after some care- • Do we have multiple points of contact at the client ful due diligence, whether they are an “ideal client” firm that provide stability over a long-term relationworthy to pursue. ship or are the risks high beyond this one project?

Ideal Client Start by asking some simple questions. Is this the ideal client for our firm to do business with? Do our two firms seem compatible as far as cultural values and business conduct? If you think these questions are far-fetched or abstract, my guess is that you have not thought enough about your own firm’s culture and business approach. This is paramount as you enter into agreements, contracts, and relationships with an entity you hardly know.

It is tough enough to manage projects with different subs and suppliers each time, but to change the client continuously really throws a curve into the mix. Each client has differing expectations and a certain communications style. Each client approaches business from their own lens and filter of experience, which is unique. You have to sort out early on whether you can navigate those fresh waters safely or if you should stick to the pool in your backyard.

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• Can we trust that future work will not be “pricedriven” with this client, but that we can sell our price based on other criteria?

As an objective outsider, I can see the many benefits to discovering this ideal client that can provide significant repeat business for many years to come.

However, another danger that AEC firms realize from success in this process is that they can become too dependent on these clients to crack their overhead nut each year. If only it were that simple, but Murphy’s Law still is alive and well. Just when you think you have all the clients you need for the next year, someone will drop out and the client list will be leaner than anticipated.

So, regardless of your success in finding and establishing your ideal clients, the business development efforts must continue forward, always in search of that next ideal client.

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March 3-5, 2016 Hyatt Regency Miami, Florida

www.SUBExcel.com

— Continued from page 14

BD Leverage

Project Proposal If your score is a 70 or above, then begin your quest to generate the most substantive proposal to gain the award. The proposal is a sales document through and through. It is necessary that every word be wellcrafted, intentioned, and relevant to your case of why you are the right supplier for that project’s need.

Throughout your proposal offer the features, benefits and proofs of every claim you make. Avoid fluff and making your firm sound as good as sliced bread. They know that you are capable of doing the work. It is your job to prove and reveal to them why you are the best one for this particular project. Now we should see that your intelligence has paid off.

For each of the Top 5 issues that the owner revealed to you, make your case showing the features, benefits and proofs of why your firm can handle that issue and will do right by the owner as seen by your successful track record with that specific issue.

This is a project resume of sorts, a proving ground of problem solving and confidence building.

Your proposal serves as a clear outline of substantive selling and if necessary, you can present following that same outline. Presentations are important. Once again, the owners have no easy point of comparison except all this stuff you share with them on the front end. You are selling your price all the way through the

proposal through the presentation and right into the ground breaking of the project.

Larry Silver is president of Contractor Marketing Inc., a consulting/recruiting firm in the AEC Industry. Silver performs strategic planning, marketing/business development audits and training, and is currently the publisher/editorin-chief of Business Development, an ezine that is distributed to more than 100,000 firms. Silver can be reached at (937) 776-7170 or larry@ contractormarketing.com.

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Feature Strategic Marketing That Works— Would You Buy Your Own Services?

by Gregg Schoppman

The days of “send it and forget it” are over. As consumers, we are inundated by millions of advertisements. Fortunately for the trees, more of the sophisticated builders have migrated to an electronic media. However, with little to no constraints on emailing, Tweeting, or Facebook and LinkedIn postings, buyers navigate through a sea of “people that will save them money, time and of course be safe.” It is almost as if buyers would relish getting an actual brochure in the mail to break the monotony of email sludge they get on a daily basis. Contractors too have migrated to electronic transmissions to demonstrate their affinity for technology. Pop quiz—is this the extent of your business’s marketing department, a heavy reliance on blanketing potential customers with email messages touting superior quality, safety and service?

Marketing continues to morph and transform to accommodate advances in technology all with the aim of establishing a firm’s brand in the marketplace. With all of the noise, there has to be a way to establish a superior strategic marketing message, leveraging a firm’s ability to message deeper and achieve higher conversion to actual construction revenue.

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Targeted Audiences, Themed Messaging The good news with technology is it has enabled inexpensive, mass communication. The bad news is this—consumers are becoming desensitized to seeing emails and constant contact. While there is undoubtedly a statistic that shows the relevance and benefit of blanket communications such as this, it resembles more of a shotgun blast than a targeted rifle shot.

There should be a deep connection between the firm’s strategic plan and the marketing audience.

Revenue potential, current contractor alternatives (for the vendor/ customer), buying traits, etc., are all relative factors that should enter into the equation of triaging this marketing list. With a healthy list assembled, it is important to tailor the messaging appropriately. First, it is probably time to shelve the messaging associated with “being on time, on budget and safe.” While it sounds like heresy, these three expectations are overused, trite and deep be blunt, a REQUIREMENT! Themed messaging should be the first priority. For instance, consider the following: • Overarching Themes—Consider something that the firm “wants to be famous for.” For instance, maybe it is a portfolio of technology projects or sustainability. Maybe it is for working in sensitive environments

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(i.e. hospitals, clean rooms, etc.)

The firm’s messaging should be constantly reinforced—saying it one time will not be enough. To be famous, the firm should consider pounding the drum over and over on its capabilities.

• Statistics that Sell—With a theme established, consider your numbers. For instance, everyone has seen the commercial about “4 out of 5 dentists agree …”

What testimonials and fact-based marketing can be leveraged? For instance, “On average, our crews finish our work 12 percent more efficiently than our competition …” or “We’ve completed 25 clean rooms …” The key here is twofold—definitively prove the value you provide and ensure the right message is making it to the right audience.

Be the Expert—Training Not Selling Let’s be honest. Most people don’t like sales meetings. They are necessary but cold or warm meetings are somewhat of an awkward courting process. Business developers want to maintain an appropriate balance of selling and listening. On the other hand, most customers have heard it all before.

Promises of greater value, better delivery, etc., etc., etc. Additionally, there may be an added wrinkle. A business developer may be speaking with a senior leader of a firm—say a general contractor—but is that person

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really the right audience or decisionmaker? Should the courtship really include an audience of estimators, procurement managers, project managers and superintendents?

One tactic to consider is to provide customized training to this larger cadre of associates. For instance, as a mechanical contractor it might be beneficial to provide training on the latest HVAC systems, the “do’s and don’ts of mechanical construction,” the intricacies of clean environments, etc. Granted, there is always a certain “spin” to this free training but consider the benefits of having a captive audience all while being the smartest technical people in the room? Ultimately, this establishes and reinforces the firm’s ability to “be the expert” and more importantly develop deeper relationships. With a dose of interactive learning, the keen marketing professional can establish a training that allows a potential customer to share their deep reservations, concerns and hot buttons. Even the most intimate sales meeting may never allow for this level of dialogue.

Proposals That Sell Look at your proposal. Really examine it. Would you buy your own services? Once you are past the bias of ownership, a deep dive into a proposal often provides a startling realization. It looks the same as every other contractor’s proposal. Price, a brief scope, a litany of exclusions and a signature.

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For larger proposals, there may be the obligatory “Personnel Tab” with resumes and “Firm Experience Tab” with glossy photos of past projects. Overall, this is hardly true differentiation. It is important to realize that strategic marketing is as much a fact-finding expedition as it is discovery of new customers.

Done correctly, a strong marketer will determine important value drivers IN THE CUSTOMER’S PERSPECTIVE. All too often, contractors determine what is important to the customer based on experience with other customers, hence the reliance on “on budget, on schedule, and safe.” Given the right amount of discovery, each customer has his or her own list of hot buttons.

Maybe this project is dependent solely on schedule. However, your firm’s proposal only touts your safety record. Misalignment leads to a “commodity view” of a contractor’s proposal—since nobody listened to what was truly the most important driver of success, everyone is evaluated on price. It is naïve to think that no customer cares about price.

However, each proposal should be customized to hit on that customer’s most important feature.

Done correctly—the targeting, the selling, the proposing—there should be a seamless flow and more important a true alignment from customer prospecting to building. This is simply one avenue to examine.

There is no shortage of avenues to explore in the marketing arena. The key themes to understand is that

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strategic marketing requires time and inter-firm collaboration to be successful. For instance, measuring performance from a labor perspective to provide meaningful statistics requires a strong bridge from the “do work” team to the “get work” team.

Ultimately the value chain is truly realized when customers buy what we are selling and most importantly performing.

As a principal with FMI, Tampa, Fla., Gregg Schoppman specializes in the areas of productivity and project management. He also leads FMI’s project management consulting practice. Prior to joining FMI, Schoppman served as a senior project manager for a general contracting firm in central Florida. He has completed complex and sophisticated construction projects in the medical, pharmaceutical, office, heavy civil, industrial, manufacturing, and multifamily markets. He has also worked as a construction manager and managed direct labor. Furthermore, Schoppman has expertise in numerous contract delivery methods as well as knowledge of many geographical markets. He can be reached at (813) 636-1259 or gschoppman@fminet. com.

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Feature Hall-of-Fame Shipping Managers Reveal Their ‘Aha’ Moments

by UPS You never know when genius will strike. For these elite shipping managers, sudden realizations have changed how they work.

Implementing a flash of insight saved time, lowered costs, reduced errors or delivered shipments to customers faster. For all of them, it was as if a light bulb suddenly lit up or a fully realized idea flashed through their brain.

Use their most profound “aha” moments to improve your own shipping operation.

1. Always control inbound shipping costs. Back when Lynna Hughes, an operations buyer for Sumitomo Electric Wiring Systems Inc., worked for another company, she noticed that the business charged shipping fees that were higher than actual shipping costs.

“If we were doing it, then other companies are probably doing it to us,” she says. So she started asking her suppliers to use her company’s UPS account number for shipments to her.

When she came to work for Sumitomo, which makes electrical and electronics systems for airplanes, automobiles, trucks, motorcycles, all-terrain vehicles and watercraft, she instituted the same policy. She estimates that the move reduces shipping costs by about one-third.

“Now, I am in control,” she says, “and all I have to say is, ‘Ship this order collect via UPS, and here is my account number.’”

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2. Automate entry of everything. Gale Peterson’s job changed for the better when she and UPS worked together to integrate her company’s in-house software with WorldShip®. Now she prints customer orders with a bar code attached and uses a bar-code reader to scan the data directly into WorldShip.

“WorldShip pulls everything needed from my internal accounting system,” she says. All she does is place the package on a scale, enter the weight and dimensions from a drop-down menu, and add her initials. “It’s very slick,” she says. “When you ship 75 to 100 orders a day, this saves a ton of time and prevents a lot of data-entry errors.”

Peterson estimates that her company, Galson Laboratories, which specializes in industrial hygiene analysis and monitoring for workplace health and safety worldwide, saves more than $26,000 per year. That includes two hours a day in data entry and an 80 percent reduction in errors.

3. Know when to dropship. Shipping manager Liz Baumgart’s world changed the day she discovered that one of her main suppliers doesn’t require a minimum order to drop-ship directly to her customers. Her company, Bob’s Flags, supplies its customers with flags of all kinds. But it can’t keep every flag in every size in stock, so it relies on a network of manufacturers and wholesalers to keep its customers saluting.

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“If I can drop-ship and get it to our customer that much faster, there you go—it’s an easy decision,” she says. And all she had to do was ask her suppliers about their policies for drop-shipping.

4. Understand the features of your shipping system. Sometimes “aha” moments are more like “oh duh!” moments. That’s how it has been for Jeremy Lang with WorldShip.

Every time he takes a few minutes to get to know WorldShip better, he learns time-saving shortcuts. He has discovered numerous helpers, such as automating the shipping service level choice and streamlining his UPS Mail Innovations® shipments for Dharma Trading, which supplies individuals and companies with textile art supplies and fabrics.

Lang says his motto is: “Anything you do, you want to learn as much [as you can] about it. I always ask myself, ‘Is this the best way to do it?’”

5. Add more workstations to increase your shipping capacity. Lang has helped Dharma Trading constantly speed up shipping.

Most recently, he added more workstations and bar-code readers to shipping rooms. He estimates the upgrades cut the time in half that it takes to process shipments.

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Legally Speaking

What’s in a Name? Protecting Your Brand

by Michelle Campney

Gone are the days of looking up a company and phone number in the yellow book or yellow pages to decide if you want to hire them or just to get information. Today, the most common way to find a company to work for you, or to determine if a company has a good reputation, or has good reviews, is word of mouth—or word of keystroke, to be more precise. If you have a teenager or a young adult in your family, you realize that no one actually talks to anyone anymore. They communicate through social media, text or the antiquated email method. In order to find out about a company, you simply turn on the computer, tablet, or smartphone and perform a search of the Internet. An Internet search will allow you to review any Web site about the company or any social media reviews. Consequently, protecting your brand becomes vital to good business practices for subcontractors.

There is a tremendous value in having a brand or presence that is easy to locate or search for on the Internet. The Internet is one of the main sources for advertising, so it is important that a prospective customer searching on Google can

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immediately find your company.

Because of the prominence of social media, no results for your company might make the prospective customer doubt your company’s existence, importance, or whether it is qualified to perform the work. It also might make a prospective customer question whether your company is qualified to perform the work. Why else would there be no information about your company. Another concern is that the search results could lead to names that are similar to your company name.

Consequently, your company needs to have a prominent, positive presence on the Internet for your trade in your area. If it is not, or if there are negative posts or reviews, the damage could be immediate and widespread. The same result will occur if there is negative news coverage about a company with a similar name or trademark. Rarely do consumers take the time to investigate the actual facts before forming an opinion. Thus, protecting your brand and your name is of paramount importance.

How can you protect your company’s brand or name?

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Trademarks & Trade Names If your company is a corporation, LLC, or any type of entity that purports to limit its members or shareholders from liability, it generally must be registered with a state’s Secretary of State or similar agency. The name must not be the same or similar to a name that is already in use in the state except under certain limited and specific circumstances. If the business name is unavailable with the Secretary of State, a company can register a different name and use the unavailable name as a DBA for the company name as long as the DBA is not trademarked. For example, if Bob’s APCO is not available, one could register the legal name of Robert J. Smith’s APCO, LLC, but use the DBA of Bob’s APCO. Registering the company trade name with the state does not afford the owner any tangible property right in the name. While a name creates goodwill without it being registered, as customers associate a company with its name, there is no way to protect the name through legal remedies unless is it registered.

Trademarks can be registered with the federal government through the U.S. Patent and Trademark Office or with the state government, if state law allows it, through the appropriate

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state agency. Trademarks can be registered with regard to products, i.e., Coca-Cola, Nike, etc., and service marks with regard to services, such as Citibank, Walmart, etc. Trademarks or service marks can be registered for words and/or symbols as long as the words or symbols are unique, i.e., the Nike Swoosh or Apple’s apple outline.

Some words are too commonplace or descriptive to be trademarked, i.e., construction, services, plumbing, etc.

Your company might have a unique way of displacing or misspelling the company name. There is an initial cost of registering a trademark federally and it has a maintenance cost as well. If a business performs services in only one state, there may not be enough benefit to having a federally registered trademark, absent a unique name or symbol for which a substantial investment has been made. If a business works regionally or in several different states, there may be enough benefit to justify registering with the federal government. A federal trademark can be registered by filing an application and submitting a specimen or example of the mark. Also, the application requires the company to register with regard to certain types of services or products. The more services or product categories registered, the higher the cost of the trademark registration. It is possible that a similar name can be used in a category in which the company is not registered. This may or may not be the same for your state registration depending upon the state’s law.

Regardless of the area where you do business or size of the company, if you have a reputation that is attached to the name of your company, there is substantial value in registering your trademark with states in which you conduct business if the state law allows it. A mark can be registered with the state even though there is no federal trademark as long as it qualified under that state’s law. Of course, the name or mark will be approved or registered only if the name is not the same or similar

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to any other mark that is already registered. This is not the same as registering your business with the state. The registration of a trademark allows the company to have legally protectable rights in the name, and this constitutes intellectual property.

If another company uses the same or similar name as your company (in an area of business that is similar to yours), you can sue them for damages, if any has been suffered.

More likely, a suit would involve asking that the other company be prohibited from using the same or similar name or mark: injunctive relief. If a name or mark is attached to your subcontracting business, it will allow the company to be recognized and marketed using that name. If the company is successful, the name of the company might be instrumental in the sale of the business. Consequently, it is worth protecting. Even though a trademark is registered, it is the responsibility of the business itself to police the unauthorized use of the name. If a business becomes aware that someone or another company is using its name or one that is similarly confusing, the business must take action to inform the other company that it cannot use its name. A letter should be sent by certified mail demanding that the company cease and desist using your company’s name. If the other company ignores this demand, the business may have to take legal action. If the business takes no action once it learns of another using its name or one substantially similar, it runs the risk of diluting the name or making it common resulting in the inability to keep the trademark.

Trade Secrets & Confidential Information It is important that your employees keep and protect your company’s trade secrets, confidential information, and intellectual property. One of the assets of intellectual property (if trademarked)

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and intangible property (if not trademarked) is the company name.

Employees should be required to sign a document as a condition of employment that states that they will not divulge or utilize for their own benefits the company’s assets, confidential information, and trade secrets while employed and after employment. This prohibition should also be included in the company’s employment handbook. Having a contract that is signed by an employee acknowledging that he must protect this information will help your company if action has to be taken. You do not want an employee using your company name to promote any side or outside business venture, just like you do not want an employee using your company’s confidential information for his own personal gain. If your employee were to steal money from your company, you would pursue them legally. A company’s name is one of its most valuable assets. If an employee uses the company name or any intellectual property without permission, it is the same thing as stealing. Such acts must be prohibited to protect the company’s assets.

Naming your business is something that takes time. It should be something that is easy to remember and unique enough to be memorable.

Once you have the name, it should be protected and valued. This name will be used as first impression of your company. If you protect it and monitor the name, it can bring you value as an advertising tool and as a valuable asset if you decide to sell your company.

Michelle Campney is an attorney with Phillips Murrah P.C., Oklahoma City, Okla. She can be reached at (405) 235-4100 or amcampney@ phillipsmurrah.com. This article originally appeared in the February 2014 edition of The Contractor’s Compass.

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ASA/FASA Calendar February 2016

May 2016

9 – Webinar: Negotiating Retainage

10 – Webinar: Websites, Email, Social Media and Your Domain Name

in the March 2016 Issue of ASA’s

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June 2016

April 2016

14 – Webinar: Damages For Lost Labor Productivity

THEME: The 50th Anniversary Edition

12 – Webinar: The Payment Dance in the Construction Industry

Contact information for all ASA and FASA events/programs:

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